Westerville OKs purchase of abandoned hotel

Westerville City Council on Tuesday, Aug. 12, approved the purchase of a dilapidated hotel property near the southern entrance to the city on State Street.

In a special meeting, the council unanimously approved an ordinance that will result in the purchase of the former Knights Inn property at 32 Heatherdown Drive for $300,000.

Assistant City Manager Julie Colley said more than $328,000 in back taxes is owed on the deteriorating property.

The ordinance allows the city to transfer funds to its Westerville Industry and Commerce Corp., the city’s economic development agency, to handle the purchase.

The city also needed to allow for additional costs, including $19,800 in “due diligence” funds and a potential $110,000 for demolition. The city's leaders, however, hope to avoid footing the bill for the demolition through a partnership with the Central Ohio Community Improvement Corp.

The COCIC is described as a “land reutilization agency” that helps communities acquire abandoned or dilapidated properties. The COCIC also has administrative authority to waive back-taxes and does not need to gain court approval before doing so.

COCIC is committed to pay 50 percent of demolition costs for the property, and the remainder of the demolition cost will be paid through a grant from the Ohio Attorney General’s Office’s “Moving Ohio Forward” program – but only if the demolition is completed by Sept. 30, officials said. In an effort to meet that deadline, council passed the ordinance on its first reading as an emergency Aug. 12, making the legislation take effect immediately.

If the city cannot get the demolition accomplished by Sept. 30, it will have to pay the $110,000.

Of the $320,000 in back taxes, about $220,000 is owed to the Westerville City School District. The city agreed to pay back half of that ($110,000) to the schools upfront, and to pay the rest in 2019 if a new property owner has not been found.

“It is very unlikely that they would have received those (back taxes) anyway because of the delinquency of the property,” Colley said of the agreement. "We don't foresee that the city will be developer of this property. We'll look for a developer in the private sector."

Colley said an appraiser set the value of the 2.8-acre property at about $750,000 as it stands and said it would be worth more than $800,000 after demolition of the old hotel.

For Westerville leaders, cleaning up the property near a gateway entrance to the city -- a site that has been riddled with crime since being vacated -- is more important than revenue.

"This was not a property that the city was looking to buy,” Westerville Law Director Bruce Bailey said. “It's a property where the city was looking to solve a problem."